GLOBAL EXPERT IN ELECTRICAL

POWER AND ADVANCED MATERIALS

JANUARY, 2018

Mersen – January 20182

MERSEN: OUR MISSION

WE DEVELOP

THE BEST TECHNOLOGIES FOR

THE INDUSTRIES OF THE FUTURE

WE PROVIDE INDUSTRIAL COMPANIES AROUND THE

WORLD WITH INNOVATIVE SOLUTIONS ENHANCING THE

PERFORMANCE OF THEIR PRODUCTS AND SERVICES

Mersen – January 20183

OUR STRATEGIC PILLARS

Improve performance

thanks to the new

organization

Improve

efficiency

Increase sales

Mersen – January 20184

AN ORGANIZATION ALIGNED WITH OUR MARKETS AND

DELIVERING SYNERGIESE

LE

CT

RIC

AL

PO

WE

RA

DV

AN

CE

DM

AT

ER

IAL

S

INDUSTRIAL SYNERGIES

Capex Operations

Anticorrosion

equipment

Graphite

specialties

Power transfer

technologies

Electrical Protection

& Control

Solutions

for Power

Management

MARKETING & SALES SYNERGIES

Customers Brands

A common DNA (small series, niche

market leader, cash

generation)

Common end-

markets(leverage Group know-

how and resources)

Shared operations(resources allocation)

R&D(cross fertilisation,

central coordination)

R&D Norms

Mersen – January 20185

STRONG LEADERSHIP POSITIONS WITH C. 15-30% MARKET

SHARE IN ALL ACTIVITIES

ANTICORROSION EQUIPMENT

#1-2 WW POSITION (Graphite products)

Competition: SGL Carbon (Ger)

GRAPHITE SPECIALTIES

#1-2 WW POSITION (High temperature

application)

Competition: Toyo Tanso (Jp), Tokai Carbon

(Jp), SGL Carbon (Ger), Schunk (Ger)

POWER TRANSFER TECHNOLOGIES

#1-2 WW POSITION (Brushes for industrial

motors)

Competition: Morgan AM (UK), Schunk (Ger)

ELECTRICAL PROTECTION & CONTROL

#2 WW POSITION (Industrial fuses)

#1 WW POSITION (Current collection for railways)

Competition: Eaton (US), Littelfuse (US), private

German players

SOLUTIONS FOR POWER MANAGEMENT

#1 WW POSITION (Passive components for power

electronics)

Competition: Eaton (US), Rogers (US), Methode

(US), Lytron (US)

ADVANCED MATERIALS ELECTRICAL POWER

Mersen – January 20186

A STRONG CUSTOMER’S PORTFOLIO

CLIENT PROXIMITY

(>65% “ON-DEMAND” PRODUCT)

REGULAR AFTER MARKET

REPLACEMENT (~65% OF SALES)

HIGH BARRIER OF ENTRY

High quality

Homologation & standards

Worldwide presence

LARGEST CUSTOMER:

< 4% OF SALES

10 LARGEST CUSTOMERS:

< 13% OF SALES

Non exhaustive List

Mersen – January 20187

POSITIVE LONG-TERM MARKET TRENDS

PROCESS

INDUSTRIES

ELECTRONICS

CHEMICALS

ENERGY19%

35%

17%

19%

10%TRANSPORTATION

FY 2016 Sales in €million

€764m

EXPANDING MARKETS

Renewable energies

Semi conductors

Power electronics

Aeronautics

Electric vehicles

INDUSTRIAL GDP

CYCLICAL

Mersen – January 20188

A GLOBAL FOOTPRINT, SOURCE OF STABILITY AND

OPPORTUNITIES WITH A STRONG PART IN ASIA

Sales as a % of 2016 figures

Number of employees at December 31, 2016

EUROPE 34%

FRANCE 9%

GERMANY 9%

UNITED KINGDOM 3%

SPAIN 3%

NORTH AMERICA 36%

UNITED STATES 31%

REST OF THE WORLD 5%

500 PEOPLE

ASIA-PACIFIC 25%*

CHINA 10%

JAPAN 4%

SOUTH KOREA 4%

INDIA 3%

1,850 people

2,200 people

1,600 people

* 17% EN 2007

Mersen – January 20189

EFFICIENT R&D SET UP TO MAXIMISE INNOVATION

POTENTIAL

Optical mirrors

for laser

technologies

Flexible and rigid felt

insulation for

semiconductor

electronics

UL-standard surge

protection

solutions for the

US market

Hybrid switch and

DC fuse for EVs

NEW POSITION OF CTO (2016) TO FASTER DECISION MAKING AND

INCREASE EFFICIENCY

SEGMENT’S CTOS TO DEVELOP SYNERGIES BETWEEN BUS

Exemples of innovation

Dis

ruptive

in

no

vatio

nA

dja

cen

t in

no

vatio

n

Mersen – January 201810

A LEANER AND MORE COMPETITIVE STRUCTURE

Competitiveness plan2016 H1 2017

2017

announced*

2018

announced*

Total

announced*

Cost savings (€m) 16.5 8 [13-16] [11-13] [43-45]

Impact on the P&L

before tax (€m)(22) (3) (10) (32)

Impact on Cash-

flow** (€m)(5) (8) (25) (5) (35)

* announce in March 2017

** including capex

COMPETITIVENESS PLAN

Reorganization of the manufacturing

footprint serving chemicals

Streamlining of product lines in EP

Reducing fixed costs

OPERATIONAL EXCELLENCE

A new position at management level (2016)

All sites involved, with a special focus on

safety and lean culture (quality, inventory

turns, delivery time) for LT benefits

Mersen – January 201811

STRONG CASH-FLOW GENERATION

FORTHCOMING DRIVERS :

Operational excellence

Lean culture

Average 2004-2008

Average2009-2013 (1)

Average 2013-2016 (1) (2)

55

17

2.7%

7.4%

55

7.3%FCF yield in %: Free cash-flow/ Sales

Free cash flow in €m: Operational Cash-flow - Capex

(1) Continuous activity

(2) excl. Exceptional items

Mersen – January 201812

A RECENT TURN-AROUND …

… THANKS TO THE EFFECTIVENESS OF MEASURES IMPLEMENTED FOR

2 YEARS (ORGANIZATIONAL STRUCTURE, COMPETITIVENESS PLANS)

-4

-2

0

2

4

6

8

10

20

15

20

16

H1 2

017

+4.9%

-0.2%

-2.2%

ORGANIC GROWTH IN SALES

7

7,5

8

8,5

9

9,5

10

20

15

20

16

H1 2

017

FY guidance

[9% - 9,2%]

CURRENT OPERATING MARGIN

8.9%

7.8%

7.5%

50

100

150

200

250

20

15

20

16

H1 2

017

NET DEBT IN €M

Net debt /EBITDA

197203

236

Reported figures

Restated figures

7.5%

8.8%

2.4

2.11.8

FY guidance

7%-8%

Mersen – January 201813

A SOUND ACTIVITY IN BOTH SEGMENTS IN H1 2017

Sales H1 2017 in €million – organic growth vs H1 2016

ADVANCED MATERIALSELECTRICAL POWER+6%

Growth in electronics, aeronautics,

chemicals and process industries

(notably, strong contribution of glass

forging for smartphones)

Renewable energies stable

+3%

Growth in Power Electronics and

Process Industries

Electrical distribution improvement

at the end of the semester but still

lower than last year

+5%

€412m

Mersen – January 201814

STRONG INCREASE IN PROFITABILITY IN H1 2017

In %

EBITDA margin H1 2016* 12.7%

Current Operating margin H1 2016* 7.7%

Volume /mix effects +0.8%

Price impact -0.4%

Competitiveness +1.9%

Inflation -1.1%

Current Operating margin H1 2017 8.9%

EBITDA margin H1 2017 13.6%

H1 2016* H1 2017

7.7%

8.9%

30

37

in €m and % of sales

* Restated (cf. press release)

Mersen – January 201815

STRONG VOLUME IMPACT ON ADVANCED MATERIALS

SEGMENT IN H1 2017

Current Operating

Margin

H1 2016* H1 2017

POSITIVE VOLUME EFFECT

UNFAVORABLE GRAPHITE PRICE

EFFECTS

GAIN FROM COMPETITIVENESS

PLANS

ADVANCED MATERIALSIN €M AND % OF SALES

7.9%

11.1%

25

16

UNFAVORABLE MIX EFFECTS

LIMITED GAIN FROM

COMPETITIVENESS PLANS

H1 2016* H1 2017

11.5%

ELECTRICAL POWERIN €M AND % OF SALES

10.3%

20 19

* Restated (cf. press release)

Mersen – January 201816

DECREASE IN NET DEBT IN H1 2017

Dec. 2016 Cash-flow fromoperations

Capex Financial interests Fx and other Jun-17

IN €M 203

197

Net Debt/EBITDA 1.8

Net Debt/Equity 42%

-16

12

5 -7

* Operating cash flow after capital expenditure before non-recurring items/sales

Mersen – January 201817

A SOLID BALANCE SHEET WITH A RECENT EXTENSION

OF THE DEBT MATURITY

1 3 10 16

3744

200*

60

2017 2018 2019 2020 2021 2022 2023

Syndicated loan China

USPP

Syndicated loan multi-currency

Schuldschein

After refinancing*

Maturity > 5 years

Unused confirmed lines after commercial paper coverage: €170m

CONFIRMED LINES IN €M AT JUNE 30, 2017, AFTER REFINANCING*

*July 18, 2017

THIRD QUARTER 2017

SALES

FY GUIDANCE

Mersen – January 201819

A QUARTER MARKED BY A STRONG GROWTH IN ASIA AND

AN IMPROVEMENT IN NORTH AMERICA

EUROPE €64M

+2%

Good performance in

aeronautics and space

NORTH AMERICA €69M

+7%

Growth in electronics, oil&gas and

process industries

Dynamism in electrical distribution

REST OF THE WORLD €8M

-3%

ASIA-PACIFIC €58M

+24%

Growth in renewable energies,

electronics, and process industries

+9% organic growth

Q3 2017: €198m

Mersen – January 201820

2017: ANNUAL ORGANIC GROWTH AND PROFITABILITY

GUIDANCE RAISED AGAIN

STRONG PERFORMANCE IN THE FIRST 9 MONTHS

FAVORABLE ECONOMIC ENVIRONMENT

PROMISING OUTLOOK FOR OUR GROWTH MARKETS

ON-GOING COMPETITIVENESS PLANS

ORGANIC GROWTH IN

SALES

CURRENT OPERATING

MARGIN GROWTH

[0-2%]

[50-100 POINTS]

[3-5%]

[80-130 POINTS]

DISCLOSED IN MARCH

2017

RELEASED ON

JULY 19, 2017

[7-8%]

[150-170 POINTS]

RELEASED ON

OCTOBER 25, 2017

2016 RESTATED* : 7.5%

* Disposal of high-power switch business

ESG

CORPORATE GOVERNANCE

CORPORATE SOCIAL

RESPONSIBILITIES

Mersen – January 201822

MERSEN’S ESG PERFORMANCE

SIGNATORY OF THE UN GLOBAL COMPACT SINCE 2009

PART OF GAIA INDEX

RATED AS “ADVANCED” IN 2016 BY ETHIFINANCE,

INDEPENDENT AGENCY SPECIALIZED IN ESG

ASSESSMENT, WITH AN OVERALL SCORE OF 64%.

Mersen – January 201823

57%30%

13%

FRENCH

INSTITUTIONAL

SHAREHOLDERS

INSTITUTIONAL

SHAREHOLDERS

OUTSIDE FRANCE

INDIVIDUAL

SHAREHOLDERS

Main shareholders

As of Dec. 2017

ARDIAN 17.7 %

BPIFRANCE

INVESTISSEMENT 15.5 %

SOFINA 8.2 %

SHAREHOLDING STRUCTURE (JUNE 2017)

Mersen – January 201824

STRONG GOVERNANCE

A DUAL STRUCTURE (CHAIRMAN

OF THE BOARD, CEO)

A BOARD OF DIRECTORS WITH 13

MEMBERS

2 representatives of Ardian

2 representatives of Bpi

1 representative of Sofina

8 independent including 1 employee

representative

3 SPECIALIZED COMMITTEE (Audit

& Account, Strategy, Governance &

remuneration)

ABIDES BY THE AFEP-MEDEF’S

CODE OF CORPORATE

GOVERNANCE

RISK MAPPING PROCESS carried

out every year under board

supervision

INTERNAL AUDIT ORGANIZATION

under audit & account

committee supervision

Mersen – January 201825

STRONG COMMITMENT TO HUMAN CAPITAL

WORKING CONDITIONS

Safety is a Group top priority

Ethic code released in 10 languages

Signatory of the UN Global Compact since 2009

SKILLS DEVELOPMENT

Mersen Academy

HR Information System

HR ROADMAP FOR 2016-2020 MAINLY FOCUSED ON:

Reinforcing a common culture around values

Mobilizing collective intelligence through an organization

promoting collaboration

Further strengthening the management culture

Excellence

Partnering with our

customers

Collaboration

People-Conscious

Agility and

entrepreneurial spirit

MERSEN’S VALUES

Mersen – January 201826

RELATED PARTIES

ETHIC CODE ALSO APPLIES TO CUSTOMERS AND SUPPLIERS

CUSTOMER KPI USED IN EVERY PLANT

On time delivery to promise / to request

Quote follow up

SUPPLIER

Selection process with CSR criteria for new suppliers

Supplier quality rate

LOCAL MANAGEMENT STRUCTURES REFLECT THE DIVERSITY

91% of plant managers are local

Mersen – January 201827

MAINTAIN BEST PRATICES IN SAFETY

Frequency rate (Mersen + Temp)

Cumulative number of lost-time occupational

accidents per million man-hours

Severity rate (Mersen + Temp)

Cumulative number of working days lost to

occupational accidents per million man-hours

Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17est

1.6

Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17est.

58

Mersen – January 201828

ENVIRONMENTAL POLICY

* Included in the reporting – 2016 figures

CLEAR COMMITMENTS STATED IN A GLOBAL ENVIRONMENTAL

POLICY

Compliance with regulations

Identification of potential hazard

Each plant has a plan to recycle and minimize consumption

Eco-design

ENVIRONMENTAL MANAGEMENT SCHEME

Management procedures deployed through a network of trained

correspondent with the supervision of the risk and audit organization

52% of industrial plants* are ISO 14001 certified

Mersen – January 201829

ENVIRONMENT – POSITION ON GREEN MARKETS

STRONG POSITION ON « GREEN » MARKETS:

90

140

85

42%

SOLAR

WIND

HYDRO

ENERGY

EFFICIENCY

(ELECTRONICS)

RAIL

EV

Based on 2016 sales figures

APPENDIX

MERSEN INSIDE

H1 2017 FINANCIAL RESTATEMENT

CONTACTS

Mersen – January 201831

MERSEN IN THE SOLAR ENERGY (SALES €40M IN 2016)

Mersen – January 201832

MERSEN IN THE WIND ENERGY (SALES €45M IN 2016)

Mersen – January 201833

MERSEN IN ELECTRONICS (SALES €140M IN 2016)

Mersen – January 201834

MERSEN IN THE AERONAUTICS (SALES €40M IN 2016)

Mersen – January 201835

MERSEN IN THE ELECTRIC VEHICLE (SALES €10M IN 2016)

Mersen – January 201836

MERSEN IN RAIL (SALES €75M IN 2016)

Mersen – January 201837

MERSEN IN CHEMICALS (SALES €75M IN 2016)

Mersen – January 201838

RESTATEMENT

DISCONTINUED OPERATION (HIGH-POWER SWITCHES AND CONTACTORS)

AMORTIZATION OF REVALUED INTANGIBLE ASSETS NOW RESTATED IN CURRENT OPERATING

INCOME (BEFORE NON-RECURRING ITEMS)

BEFORE AFTER

H1 2016 H2 2016 2016

Sales 387.2 376.4 763.6

Current Operating

Result30.6 29.3 59.9

Current Operating

Margin7.8% 7.8% 7.8%

Non-recurring income

and loss(3.5) (23.0) (26.5)

Amortization of

revalued intangible

assets

(0.7) (0.5) (1.2)

Operating Result 26.4 5.8 32.2

H1 2016 H2 2016 2016

Sales 384.9 374.1 759.0

Current Operating

Result29.3 28.0 57.3

Current Operating

Margin7.6% 7.5% 7.5%

Non-recurring income

and loss(3.5) (23.0) (26.5)

Operating Result 25.8 5.0 30.8

Mersen – January 201839

CONTACTS

VÉRONIQUE BOCA, IR

veronique.boca@mersen.com

+33 1 4691 54 40

MERSEN.COM/INVESTORS/PROFILE

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